Meme Stock Phenomenon Returns with Reddit and Trump Media Leading the Charge

The resurgence is marked by significant trading surges in Reddit and Trump Media shares, driven by social media enthusiasm and disregard for traditional valuation metrics.

• Reddit's IPO saw shares soar by up to 120%, while Trump Media's stock experienced a one-day gain of up to 59% after its SPAC debut.
• The meme stock trend is fueled by an 'us versus them' mentality on social media, emotional investing, and stratospheric valuations attracting short-sellers.
• Experts offer three criteria for identifying potential meme stocks: social media fuel, emotion-driven investing, and high valuations.
• Despite questionable profit prospects, Reddit and Trump Media have become the latest meme stocks, with their trading activity driven largely by small investors.
• The phenomenon's resurgence comes amid a strong first quarter for the stock market, with the S&P 500 on track for a nearly 10% price gain.

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Benzinga Associated Press Markets Insider